Fine Lines Extraordinary Apparel Pty Limited v Gazal Apparel Pty Limited

[1999] ATMO 96

TRADE MARKS ACT 1995

DECISION OF A DELEGATE OF THE REGISTRAR OF TRADE MARKS,
WITH REASONS

Re:Opposition by FINE LINES EXTRAORDINARY APPAREL PTY LIMITED to registration of trade mark application number 730540 in the name of GAZAL APPAREL PTY LTD for the trade mark FINEFORM in class 25

Background

On 25 March 1997, Gazal Apparel Pty Ltd (the applicant) filed an application to register the word FINEFORM as a trade mark in respect of "men's, women's and children's clothing, headgear and footwear", which goods belong to class 25.

Subsequent to examination of the application, the mark was accepted for registration and advertised as such in the Australian Official Journal of Trade Marks of 7 May 1998 in respect of "women's underwear and lingerie".  The provisions of subsection 41(5) applied to the acceptance of the mark.  On 22 May 1998, Fine Lines Extraordinary Apparel Pty Limited (the opponent) filed a notice of opposition.  The notice of opposition contained nine grounds of opposition.  However, at the hearing, the opponent largely addressed the following grounds:

• that the applicant's mark is not capable of distinguishing its goods from those of other traders

• that the applicant's mark is substantially identical with, or deceptively similar to, one or more trade marks registered by the opponent in respect of similar goods

• that the applicant's mark would be likely to deceive or cause confusion because of reputation of a mark acquired before the priority date.

A hearing on the opposition was held in Canberra.  Mr Alfred Tatlock, an attorney of A Tatlock & Associates, appeared for the opponent.  Mr Richard Cobden of Counsel, instructed by Mr Julian Blenkinship of Barker, Blenkinship & Associates, represented the applicant.

The evidence
The evidence in support comprises a statutory declaration by Timothy George Kitching, the managing director of the opponent company.  The mark FINE LINES had been first adopted in 1983 in respect of ladies' lingerie by Jessenik Holdings Pty Limited and assigned to the present opponent in 1989.  Year by year figures are set out as to sales, but it is not indicated whether these figures are in relation to the mark FINE LINES.  Although the declarant claims the goods have been extensively advertised, no exhibits are attached to the declaration. 

Several statutory declarations form the evidence in answer.  Peter Woods, the secretary of the applicant company, has filed a declaration with exhibits.  The word FINEFORM was selected for use as a trade mark in March 1997.  Its first use occurred in November 1997.  Mr Woods annexes to his declaration exhibits showing the retail sales figures and advertising expenditure.  Further exhibits comprise samples of advertising material and a swing-tag in relation to the mark. 

Michelle Christine Pritchard, a trade mark searcher, has conducted a search of the Australian Trade Mark Office records to determine the state of the Register in respect of marks containing the word FINE, covering clothing in class 25.  The results of her search are compiled in her statutory declaration. 

Two persons involved in the clothing trade, Launa Karen Inman and Kay Marjorie Douglas, in their respective statutory declarations, attest as to their knowledge of the opposed mark in respect of ladies' underwear and its connection with the applicant.

The opponent sought permission and was granted an application to serve further evidence, providing that certain words in the statutory declaration accompanying application, to which the applicant had objected, be disregarded.  The opponent consented to this.  The further evidence is an affidavit by Barbara van Meurs, solicitor and technical assistant employed by the firm of attorneys acting for the opponent.  Ms van Meurs has carried out searches of registrations and pending applications for marks which include the part words FINE or LINE in class 25.  The results of her searches are either included in the affidavit or annexed as exhibits thereto.  In addition, Ms van Meurs exhibits copy of a statutory declaration by Mr Michael Gazal in support of a claim of a risk of confusion between the opponent's and the applicant's marks.

Submissions and analysis
Mr Tatlock, on behalf of the opponent, expressed concern on the timing of the issuance of my decision on the present opposition, basing his reasons on Federal Court proceedings in respect of the opponent's and the applicant's trade marks.  He maintained that it would not be in the interest of the parties, or the public, for the decision to be handed down before the Court proceedings were determined. The opponent was alleging rights in its trade mark and passing off of the mark by use of the mark FINEFORM, and therefore it would be most undesirable to make a decision in the present opposition, which could be detrimental to either party, whilst the action was proceeding in the court.  For those reasons, Mr Tatlock requested that the decision be withheld until the matter in the Federal Court is determined.  Alternatively, he proposed that the opponent be provided with a notification to enable the opponent's legal representative to decide whether to obtain from the Court an order for stay of the decision in the matter.

Mr Cobden submitted that the proposed action would not be appropriate, as the two matters were quite separate.  He also commented that the matter had been on foot for some considerable time.  

From the history of this case, I note that, pursuant to reg. 5.14(2), the applicant had made a request to the Registrar, by letter of 1 April 1999, to have the present opposition heard.  Before the date of the scheduled hearing, the opponent's attorneys had sought deferral of the hearing, pending a Federal Court action, on the basis that the Registrar should not allocate trade mark rights in a mark where such rights were currently the subject of Court proceedings.  As the attorneys for the applicant did not consent to the hearing being deferred, and the parties concerned had been given notice of the hearing under reg. 21.15(3)(b), the hearing proceeded as scheduled.

I have not been presented with any documents as to the exact nature of the issues before the Federal Court, nor would it have been proper to do so at such a late stage in the opposition proceedings. Apart from Mr Tatlock's brief submissions, I have not been made aware to what extent the matters, now before the Registrar for determination under the Trade Marks Act, are interrelated with the pending action in the Court. There is no indication as to when the proceedings are likely to be determined. All these factors notwithstanding, s.55 of the Act provides that, unless the opposition proceedings are discontinued or dismissed, a decision must be made either refusing to register the subject trade mark, or directing that the mark be registered, depending on whether or not the grounds relied upon in the opposition have been established. It is apparent that no leeway is contemplated under these provisions. Furthermore, it is incumbent on the delegate of the Registrar to decide the disputes raised in an opposition in an efficient and expeditious manner.

Having considered the opponent's request in light of the above circumstances, I am obliged to proceed with my decision in the normal fashion.  Consequently, the opponent's request to delay my decision is denied. 

Is the applicant's mark capable of distinguishing - s.41?
Noting that the applicant's mark had been accepted under the provisions of s.41(5) of the Act, Mr Tatlock submitted that the short period of use of the mark and the sales value of the goods, as shown in Mr Wood's declaration, would not justify its acceptance.  In his view, in considering registration of a mark under these provisions, the time and amount of use of the mark would need be up to ten years in duration with sales in the relevant industry to be many millions of dollars.

In relation to use of the mark, Mr Cobden tendered a supplementary declaration by Mr Peter Wood, the person whose declaration forms part of the evidence in support.  This declaration is dated 27 May 1999 and sets out updated sales figures of the goods.  Responding to Mr Tatlock's submissions, Mr Cobden said that the Registrar was well placed to see whether the threshold of s.41(5) had been met from the number of applications examined and the type of evidence of use provided.  He argued that the mark FINEFORM had a significant degree of inherent adaptability to distinguish because, although the two components of the words had some suggestive qualities, the word FINE- having the strongest of these qualities, the mark consisted of a combination of the words, which had a degree of inherent adaptation to distinguish.  He pointed out that, for the purpose of s.41(5), consideration would have been given to the overall impression of the mark.  Under the current Act, he submitted, the burden of proof that the mark was registrable had changed from the repealed Act, because of the presumption of registrability and the outcome of s.33, i.e. that,. unless there was a ground of rejecting an application, then the application must be accepted.  The opponent carried the same burden into opposition proceedings as, in effect, did the Registrar during the application process.  

S.41(5) of the Act reads as follows:

41.(5)   If the Registrar finds that the trade mark is to some extent inherently adapted to distinguish the designated goods or services from the goods or services of other persons but is unable to decide, on that basis alone, that the trade mark is capable of so distinguishing the designated goods or services:

(a)the Registrar is to consider whether, because of the combined              effect of the following:

(i)the extent to which the trade mark is inherently adapted to

distinguish the designated goods or services;

(ii)the use, or intended use, of the trade mark by the applicant;

(iii)or any other circumstances;

the trade mark does or will distinguish the designated goods or

services as being those of the applicant;

(b)if the Registrar is then satisfied that the trade mark does or will so

distinguish the designated goods or services - the trade mark is taken

to be capable of distinguishing the applicant's goods or services

from the goods or services of other persons; and

(c)if the Registrar is not satisfied that the trade mark does or will so

distinguish the designated goods or services - the trade mark is

taken not to be capable of distinguishing the applicant's goods or

services from the goods or services of other persons.  

The Macquarie Dictionary defines the word "fine", inter alia, as: "1. of the highest or very high grade or quality. … 4. choice, excellent, or admirable. … 6. very thin or slender … 10. delicately fashioned. … 17. showy or smart; smartly dressed.".  The word "form" has been ascribed many meanings, as listed in the said dictionary, but, in the present context, the most relevant meaning would be "external shape or appearance considered apart from colour or material … the shape of a person".  Used in relation to the goods of the present application, these words would indicate that the articles of women's underwear and lingerie give the wearer slender or attractive body shape or appearance.  Thus, the word combination FINEFORM has some descriptive connotation, but it is not one most appropriate for normal description of the goods.  The opponent, however, has not contended that the mark is totally devoid of inherent adaptability to distinguish the applicant's goods, arguing that the evidence of use of the mark does not satisfy the requirements of s.41(5). 

The declarations of Mr Woods indicate first use of the mark in November 1997 - about seven months after filing of the application.  In the last calendar quarter of 1997, the retail sales of the goods have been estimated to have amounted to $390,000.00.  Since then, up to April 1999, the approximate value of these sales has risen to $2,277,000.00.  In addition, the applicant has received orders for delivery of $600,000.00 worth of the goods to be supplied to retail stores for the remainder of 1999.  In advertising and promoting the goods, the applicant has estimated the expenditure to be a total of $63,400.00 in 1997 and 1998.

Given that the applicant's goods are limited in range and fall in the category of the lower end of the market, I consider that their sales value is fair.  For a mark to be evaluated in terms of s.41(5), the applicant may demonstrate the mark's use before or after the date of filing of the application, but the required evidence of use depends, of course, upon the degree to which the mark is considered to be inherently adapted to distinguish.  In the present case, the market exposure of the applicant's mark has not been long.  However, the sales over the period of use have increased steadily and show a potential of continuing the growth in the future.  Considering then the combination of factors that are to be taken into account for the purposes of s.41(5), I am satisfied that the provisions of s.41(5) properly apply to the applicant's mark.

Accordingly, the opponent has failed in relation to the s.41 ground of opposition. 

The opposed mark substantially identical with or deceptively similar to the opponent's mark - s.44

Under the provisions of s.44(1), an application for registration of a mark must be rejected if the mark is substantially identical with, or deceptively similar to, a registered mark or a mark pending acceptance which holds priority date, and the goods of the respective marks are similar or closely related to services.  The term "deceptively similar" is defined in s.10 as one which "so nearly resembles the other trade mark that it is likely to deceive or cause confusion".  Under s.14 "similar" goods are the same goods or goods of the same description. 

In relation to this ground of opposition, Mr Tatlock referred to the opponent's word mark FINE LINES which has been registered, under number 503498, since 24 January 1989 for "ladies' lingerie, bras, corsetry, and sleepwear; men's underwear and sleepwear".  He said that, for some fifteen years, this mark had been the only mark on the Register commencing with the word FINE- and covering "lingerie".  Whilst few other marks in class 25 had incorporated the same word, none of those was at all similar in appearance or sound to FINE LINES.  The subject mark, FINEFORM, however, created a very similar impression to FINE LINES.  Mr Tatlock submitted that it would not be unexpected for persons, who knew well the opponent's mark, to be either deceived or confused when seeing the applicant's mark.  They might wonder whether the goods came from the same source, or, at least, that there was some form of connection with the same manufacturer of the goods, as per Southern Cross Refrigerating Co v Toowoomba Foundry Pty Ltd (1954) 91 CLR 592. He said that Mr Gazal, in a statutory declaration included in the further evidence, had envisaged a possibility of deception or confusion between the marks. Here Mr Tatlock referred to a declaration by Mr Michael Gazal, the applicant company's managing director, who, in support of a request to have the application expedited, had claimed that his company's marketing personnel had experienced negative feedback from contacts in the marketplace, because of alleged similarity of the subject mark with other marks.

Mr Cobden submitted that, in the present case, the opponent was seeking to secure a  monopoly over the word FINE- and, from the evidence of Ms van Meurs, also over the word LINES.  Yet, each of these words was in common use in clothing and in areas of fashion and appreciation generally, such as in fine arts, fine food and wine, fine wool, superfine wool, fine cotton, finer things of life.

Mr Cobden rejected the view that the marks were similar, when the appropriate allowance was made for the word FINE-.  That conclusion, he said, was assisted by the opponent's evidence.  Further, despite having taken an opportunity to refresh its evidence out of time and very recently, the opponent had not come up with a single instance of confusion, deception or wonderment, although the applicant's products had been on the market in substantial quantities for some eighteen months.  As to Mr Gazal's statement in his declaration, at best, it could be construed as an anticipated fight about the mark.  In any event, the matter being at least of mixed facts and law, it was not one capable of being admitted, as per Eastern Express Pty Limited v General Newspapers Pty Limited (1992) 35 FCR 43 at 68; Rhone-Poulenc Agrochimie SA v UIM Chemical Services Pty Limited (1986) 12 FCR487-8, 504. In those cases, admissions as to matters raised by s.52 of the Trade Practices Act 1974 had been dismissed by the Full Federal Court as being of no weight. 

Both parties appeared to be in agreement that the goods of the opponent's registration 503498 also embraced those of the present application, therefore the goods are similar for the purpose of s.44.

Neither Mr Tatlock nor Mr Cobden suggested that the two marks under consideration might be identical, nor do I think they are, when regard is had to the side by side comparison of the marks, as enunciated in Shell Co (Aust) Ltd v Esso Standard Oil Aust) Ltd (1961) 109 CLR 407 at 414-415. Clearly, the marks display sufficient differences in their appearance, pronunciation and meaning for them to be regarded as identical.

During the submissions by the parties, reference was made to the two often cited cases containing the guidelines on comparing trade marks to determine whether they are in conflict: Pianotist Co's Appn (1906) 23 RPC 774 at 777 and Australian Woollen Mills Ltd v F.S. Walton & Co Ltd (1937) 58 CLR 641 at 658. In the latter, Dixon and McTiernan JJ said at p658:

In deciding this question, the marks ought not, of course, to be compared side by side.  An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of the injunction is sought.  The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same.  The effect of spoken description must be considered.  It a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, their similarities both of sound and of meaning may play an important part.  The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected.  Potential buyers of goods are not to be credited with any high perception or habitual caution.  On the other hand, exceptional carelessness or stupidity may be disregarded. 

Both marks under consideration, FINE LINES and FINEFORM, share the same first word.  The second word in the opponent's mark is rendered in the plural form, whereas that in the applicant's mark is not.  Mr Tatlock argued that the words LINES and -FORM, in combination with FINE-, would give an overall impression of a similar idea.  According to the standard English dictionaries I have perused, the word "line", inter alia, conveys the meaning of a contour or outline.  Adapted for use in the sense of describing garments and prefixed by the word "fine",  I concede it could suggest exquisitely fashioned and shaped undergarments.    

Both the opponent's and applicant's evidence contains search results of marks in class 25 which include the word FINE.  These searches show a number of word marks, registered or awaiting registration and holding priority dates, which comprise two readily identifiable components, the first word being FINE: FINE FEATHERS (302856 - remained on the Register from 7 December 76 to 21 January 1999), FINEBOY (643605), FINE SHOT (709771) and the opponent's own FINE LINES.  In relation to the mark FINEBOY, Ms van Meurs exhibits mail directed to the owner of this mark at its P.O. Box address, which has been returned to the opponent's attorneys.  The unclaimed letter, where enquiries are made as to whether ladies' lingerie was still manufactured by the owner of the mark, cannot be taken as proof that the proprietor has ceased trading in the goods under the mark.  Of the marks cited, therefore it appears that, at least FINE FEATHERS, FINEBOY and FINE LINES, were concurrently registered in respect of goods which included ladies' underwear and lingerie. 

Mr Cobden has directed my attention to the accepted principle that, if part of a trade mark is common to the trade, or descriptive, then that part must be discounted when drawing comparison between the marks.  In Australian Law of Trade Marks and Passing Off, second edition, by D.R. Shanahan, at p. 178, under footnote 73, are listed cases where this principle was considered.  In instances where the same or similar idea is engendered by the marks, as may be the case here, it has been found that there will be purchasers who may remember the idea associated with the words of the marks rather than any features that might distinguish the marks, if they are viewed side by side - Jafferjee v Scarlett (1937) 57 CLR 115 and de Cordova v Vick Chemical Co (1951) 68 RPC 103. However, where the idea expressed by the marks is somehow descriptive, but otherwise different elements appear in the marks, that factor alone would suffice to distinguish the marks. Thus, in Cooper Engineering Co Pty Ltd v Sigmund Pumps Ltd (1952) 86 CLR 536, the High Court said at 539:

But it is obvious that trade marks, especially word marks, could be quite unlike and yet convey the same idea of the superiority or some particular suitability of an article for the work it was intended to do.  To refuse an application for registration this ground would be to give the proprietor of a registered trade mark a complete monopoly of all words conveying the same idea as his trade mark.  The fact that two marks convey the same idea is not sufficient in itself to create a deceptive resemblance between them although this fact could be taken into account in deciding whether two marks which really looked alike or sounded alike were likely to deceive.

These observations, I believe, apply to the marks under consideration.  The marks FINE LINES and FINEFORM do not closely resemble each other in sound and look.  Furthermore, there is no question as to the descriptive meaning of the word FINE- in the marks, when used in relation to the goods, as discussed above, and the searches in the evidence demonstrate it to be incorporated in trade marks by other owners involved in the same trade.  In light of these factors then, if there is any perceived similar idea or impression conveyed by the marks, there should be no reasonable likelihood of deception or confusion occurring. 

In view of my above findings, I do not consider that the opposed mark offends against the provisions of s.44. 

Use of the opposed mark would cause deception or confusion because of reputation of the opponent's mark - s.60  

Mr Tatlock submitted that in opposition to registration, provided an initial barrier by the opponent had been met, the onus of proof that the mark was to be permitted registration then shifted to the applicant.  Where the opposition was based on the ground that a trade mark was likely to deceive or cause confusion, the initial onus was on the opponent to show a sufficient reputation upon which to found such objections, citing Kendall Co v Mulsyn Paint & Chemicals 109 CLR 300 and First Tiffany Holdings Pty Ltd v Tiffany & Co (1989) 13 IPR 589. He said that the opponent had satisfied that onus by showing long and extensive use of its mark. The applicant's evidence, on the other hand, was minimal and in no way convincing to prove no likelihood of deception and confusion occurring. Furthermore, he said, in cases such as the present, the public interest was of primary concern, and here it would be better served by refusal of the application.

In line with his submissions on the s.44 issue, Mr Cobden said that the marks would need to be deceptively similar to have any bearing on s.60.  Further, the opponent's evidence had not sufficiently given a picture of the opponent's mark in the marketplace to enable any finding about its reputation to be made. 

Under the provisions of s.60 -

1. The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:

(a)it is substantially identical with, or deceptively similar to, a trade mark that, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, had acquired a reputation in Australia; and

(b)because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.

I have already concluded that the mark of the present application is neither substantially identical nor deceptively similar to the opponent's mark of registration 503498.  If, however, I have erred in my findings, the next step to determine would be whether the reputation in the opponent's mark is such as to cause deception or confusion, if the subject mark was used in relation to the goods specified in the application.  The reputation of the mark is to be assessed at the date of filing the application - Southern Cross v Toowoomba Foundry, supra.  Here that date is 25 March 1997.  It is also established law that a mere possibility of confusion would not be sufficient because "there must be a real, tangible danger of its occurring" - Southern Cross v Toowoomba Foundry at 595.  And that risk of deception and confusion must exist amongst a substantial number of persons who are likely to be interested in purchasing the goods concerned - Smith Hayden & Co Ltd's Appn (1946) 63 RPC 97 and Kendall v Mulsyn Paint, supra.

No evidence has been presented to the effect that use of the applicant's mark has caused deception or confusion.  Ms Inman and Ms Douglas, who have been involved in the women's underwear trade, know of the mark FINEFORM, associate it with the applicant and have sold goods under the mark.  As they were not required to respond to the question on any confusion between the marks, or any likelihood of confusion, their declarations merely support Mr Wood's evidence concerning use of the applicant's mark. 

Relying on the opponent company's records, as well as those of its predecessor, in his declaration, Mr Kitching is able to attest to a brief history of the mark, its use having commenced in 1983.  Turning to the sales figures, Mr Kitching states that he has examined both companies' records and then proceeds to list the figures for every fiscal year from 1983 to 1998 which, in total, amount to approximately $72,000.000.  However, he fails to state that these figures specifically represent sales of the relevant goods under the mark FINE LINES in Australia.  Even if the sales relate to the mark, then these figures could also include sales in New Zealand where, according to Mr Kitching's subsequent clause in the declaration, the opponent has extending its trading activities of products bearing the mark.  Further, Mr Kitching's assertions as to extensive advertising of the products under the mark, such as in national magazines and major store catalogues, are not substantiated by any evidence whatsoever, nor has he made available advertising expenditure and samples of the mark in use.  Such material is essential for assessing how widely the mark has been publicised and would be reasonably likely to be recognized by members of the purchasing public.  

Mr Kitching's declaration constitutes the only evidence in support of the alleged reputation of the opponent's mark.  It is deficient to the extent of being too general and lacking information in significant areas which would assist in determining whether any acquired reputation of the mark would be likely to cause deception or confusion.  Assuming that the indicated sales are in respect of the mark FINE LINES in Australia, and it cannot be denied that the sales value is substantial, I am still faced with the declarant's unsupported assertions that

"the brand has clearly been accepted as a fashion leader in the intimate apparel market and has acquired over the last 16 years a very considerable reputation such that the use of any similar mark in relation to lingerie must of necessity cause confusion…".

Mere evidence that the mark has been used for a certain period does not necessarily establish reputation in the mark.  As the inadequate opponent's evidence does not enable me to fully assess the matter, I must, in my conclusions, agree with Mr Cobden that the opponent has failed to mount a case in terms of s.60.

Conclusions
From the foregoing, I have found that the opponent has failed in relation to the three grounds of opposition argued at the hearing.  Accordingly, I dismiss the opposition.  It follows that, subject to any appeal from this decision, the application should now proceed to registration. 

Costs
Both parties have sought costs in these proceedings.  I see no reason why costs should not follow the event.  I therefore award costs in this matter to the applicant. 

Vija Zars
Hearing Officer
27 September 1999